UK house prices fell in December, with annual growth at its weakest level in more than 18 months. The average property price dropped 0.4% from November to £271,068, Nationwide reported.
Annual price growth slowed to 0.6%, the lowest year-on-year increase since April 2024.
Changes to stamp duty in April caused fluctuations in the market during the spring and summer, while the timing of the November budget added uncertainty in the final quarter of the year.
Nationwide also said the share of first-time buyers in the market is above the long-run average, and loans with a deposit of 15% or less are at their highest level in a decade.
Industry reactions:
Jason Tebb, president of OnTheMarket: “As 2025 drew to a close, overall the housing market demonstrated remarkable resilience, particularly given the uncertainty that prevailed for many weeks in the run-up to the Budget.
“Activity has been steady as focused buyers and sellers proceed with their transactions. While property values are being held in check partly as affordability challenges remain a concern, particularly in Southern England, some pent-up demand – which resulted in decisions being put on hold towards the tail end of last year – may now result in a January market which is busier than one would normally expect.
“Encouragingly, the number of first-time buyers picked up over the past year, which is important for the overall health and functioning of the housing market.
“Another base-rate reduction in December eased some of the pressure on borrowers, with lenders ending the year trimming rates. The rock-bottom mortgage rates of the past may be behind us, but buyers have adapted, and with the hope of further cuts to come, they can plan ahead with more confidence.”
Iain Mckenzie, CEO of The Guild of Property Professionals: “The latest Nationwide HPI figures show the market ending 2025 on a softer note, with annual price growth easing to 0.6%, but this should be seen more as a gentle cooling than any loss of underlying resilience. Price growth remained remarkably steady throughout the year despite pre-Budget uncertainty and a notable increase in the number of homes for sale.
“What’s particularly encouraging is that activity has held up well. With around 1.2 million homes sold in 2025, the highest level since 2022. It’s clear that steady mortgage rates and rising wages have continued to support demand, even as buyers became more price-conscious towards the end of the year.
“The Bank of England’s decision in December to cut the Bank Rate from 4% to 3.75% is a timely boost for confidence. While inflation remains above target, the latest figure coming in lower than expected will help reinforce sentiment. Lower borrowing costs, combined with a Budget that proved less severe than many feared, should underpin activity as we head into the spring 2026 selling season.
“Overall, while headline price growth has slowed, the fundamentals remain positive. We expect market momentum to strengthen in the New Year as improved affordability and greater certainty encourage more buyers and sellers to make their move.”
James Nightingall, founder of HomeFinder AI: “Post-Christmas is peak time for property searches online. Particularly first-time buyers have shown a similar level of motivation to last year. That being said, some still struggle to save up a sufficient deposit. On a positive note, we are seeing an increasing number of developers who offer incentives or lower their asking price which should see more buyers make the step towards homeownership this year.”
Ian Futcher, financial planner at Quilter: “Although Christmas is now behind us, December itself is rarely a month that sees much momentum in the housing market. This year, that seasonal slowdown was amplified by the timing of the budget. With key fiscal decisions pushed later into the year, many prospective buyers and movers chose to put plans on ice until they had clarity on the policy landscape, before then allowing those plans to slip further as attention turned to the festive period.
“Against that backdrop, Nationwide’s figures showing prices slipping back by 0.6% over the month reflect a market that was firmly in ‘wait and see’ mode.
“On an annual basis, prices are just 0.6% higher than a year ago, underlining that activity has been subdued and house prices have stagnated. A lack of available housing stock continues to provide underlying support, but affordability pressures limits how far prices can move ahead.”
Nathan Emerson, CEO of Propertymark: “Aspiring and current homeowners will no doubt have felt reassured heading into the end of the year, with falling inflation and base rates improving affordability and helping more buyers consider their next move during 2026.
“Given the number of policy and economic changes the housing market experienced throughout 2025, including legislative updates, mortgage rate fluctuations, and the Autumn Budget, a period of price stability is an encouraging outcome.
“Stable house prices provide a solid foundation for the year ahead, allowing buyers and sellers to make more informed decisions without the pressure of rapid price movements. As the market continues to adjust, this stability should support activity and confidence throughout 2026.”
Read the orginal article: https://propertyindustryeye.com/property-industry-reacts-to-latest-house-price-data-14/?utm_source=rss&utm_medium=rss&utm_campaign=property-industry-reacts-to-latest-house-price-data-14
